Posts Tagged 'Retail Wire'

Can Nordstrom find growth outside of its Rack expansion?

Nordstrom seemed immune from the problems plaguing the rest of the department store sector, but this is no longer the case. I posted some thoughts on RetailWire last month after the company’s earnings announcement:

If I were a JWN shareholder, I’d be happy that the company is growing the Rack business. It’s good to have a growth vehicle in light of the well-documented issues with both the traditional department store business and the near-luxury brands like Coach, Michael Kors and Ralph Lauren. And Nordstrom has always been very cautious about opening its full-line stores.

This being said, the company’s brand reputation is really built on the success of its full-line stores. I shopped my local Nordstrom on Saturday (newly opened in Milwaukee last fall) and I wonder whether a little more attention to the store’s value positioning — without hopping on Macy’s promotional carousel — might help its traffic levels and reduce its clearance levels more effectively.

And some further thoughts about how Nordstrom can grow its core business, based on its announcement about a partnership with J. Crew:

For Nordstrom, this continues a trend that already includes partnerships with Madewell and Topshop. A presence inside Nordstrom has helped these two labels create brand awareness (and benefit from the halo effect) as they build out a relatively small footprint of their own stores.

The association with J. Crew is different: This brand has been in the penalty box with its loyal fans for at least a couple of years, and it’s debatable whether its merchandise content problems have been fully addressed yet. (Plus, there is no scarcity of J. Crew locations across the country.) I see more upside for J. Crew than for Nordstrom (especially if JWN has to carve out space that could be devoted to higher-performing goods), but it puts some burden on JWN to make sure that its J. Crew shops put forward the “best of the brand.”


Throwing traditional shopping “roles” out the window

A RetailWire discussion in response to new survey data showing the importance of men as grocery shoppers:

Most recent studies tend to turn shopping stereotypes upside down. The study showing that men do the majority of food shopping is a good parallel to the data demonstrating women’s roles in making decisions about car-buying and electronics. (There is probably contrary data to disprove these points, if you look hard enough or ask the survey questions in a certain way.) Bottom line, regardless of the data points, is that gender stereotypes probably need to be thrown out the window as they pertain to shopping patterns, especially since the outbreak of the Great Recession.


Steinbrenner: Thoughts about workplace behavior

A little “off topic” compared to the usual RetailWire panel discussion, but George Steinbrenner’s recent passing triggered a conversation about workplace behavior. Here are my thoughts:

From the perspective of Yankees fans (count me out), I’m sure Steinbrenner achieved his most important goal as a team owner: Provide a winner on the field in order to drive the rest of the business model. And looking at it purely in terms of wins and losses, TV ratings, the growth in his franchise’s value and the construction of a new stadium, you have to rate Steinbrenner as a towering success.

As other panelists have noted, however, it’s clear from much of the frank reporting and commentary last week that Steinbrenner was a workplace bully of the first order. Is it possible to run a consistently winning, profitable sports franchise while behaving like a “class act”? I’m sure fans of the Steelers, the Celtics and other teams would argue that point. It’s worth pointing out that baseball — the only major sport without a meaningful salary cap — allows a “win at any cost” owner with a personality disorder to dominate the game for decades.

Mobile apps meet aggressive marketing

RetailWire panelists recently discussed the pros and cons of mobile apps and texts intended to send promotional info to consumers. Not such a bad thing, in my opinion:

I don’t think marketers can jump to any conclusions — one way or the other — about whether text-messaging of ads is a net positive or negative. Does the risk of alienating some consumers get overshadowed by the benefit of targeted reach? Do consumers who are more likely to object have the ability to “opt out” (just as they can filter out e-mail ads or telemarketers)? If so, there is a lot to be gained by the smart use of technology in a “handheld app” world.

Can Google catch Apple?

Interesting discussion at RetailWire about the cell phone business. The focus is whether Google has a chance at catching Apple. I say no:

I wouldn’t bet against Apple in this race. While Google is making strides in a lot of areas outside its original focus on search, it does not have Apple’s huge advantage in vertical integration. Apple has developed so much hardware to maximize use of iTunes — between phones, MP3 players and computers — that its headstart is similar to the advantage enjoyed by RCA back in the “good old days” when it owned a TV network and sold televisions. At the same time, Google is at the mercy of other companies building Android into their phones and other devices, without a clear strategy to catch up to Apple’s lead.

The return of Gottschalks…or not

Count me among the skeptics (on RetailWire) about the chances for the previous management of Gottschalks in California to revive the brand:

Not clear how the very same team that failed to make a go of Gottschalks the last time is going to make it work now. During the last few years, Kohl’s has gone from a handful of L.A. stores in 2003 to over 120 stores throughout California today. It’s hard to see a valid “reason for being,” with Kohl’s at one end of the promotional department store spectrum, Penney continuing to have a strong footprint, and Macy’s domination of the moderate-to-upper position.

Best Buy leads the way toward 3D televisions

Interesting recent RetailWire panel discussion about whether Best Buy ought to be the leader in 3D televisions. Absolutely, I say:
The 17% survey result (that 3D sets will be widespread in the next five years) is probably a low number compared to what will really happen. Time and time again, there is a back-and-forth between the spreading of new technology and lower prices to consumers…as this happens, new technology invariably reaches mass appeal. Look at the popularity of blu-ray players…and, for that matter, large-screen TV’s as an overall category.
That being said, it’s vitally important for the category leader in consumer electronics retail (Best Buy) to establish a beachhead in 3D televisions. Credibility among “early adapters” is a must for Best Buy, and the long-term commercial potential for 3D sets is significant (even if it reaches “only” 17%).